The recent case of Rhodia International Holdings Limited and Rhodia UK Limited v Huntsman International LLC [2007], provides new guidance on a long-disputed area of contract law. According to the judgment of the High Court, a duty to exercise ‘reasonable endeavours’ requires less than ‘best endeavours’ but can still demand a party to act against its own commercial interests, although the case does not resolve all the uncertainty surrounding the difference between ‘reasonable’ and ‘best’ endeavours.

The case confirms that ‘reasonable endeavours’ is a less stringent obligation than ‘best endeavours’ – a concept which is commonly assumed. The case also confirms that a ‘reasonable endeavours’ obligation may be discharged by exhausting just one of a number of possible solutions, whereas a ‘best endeavours’ obligation requires all avenues to be explored.

Huntsman International LLC (“Huntsman”) had agreed to buy Rhodia International Holdings Limited and Rhodia UK Limited (“Rhodia”), a chemicals company. As part of the sale and purchase agreement both parties were to use reasonable endeavours to ensure that all supplier contracts passed from Rhodia to Huntsman, including one with a power company called Cogen.

However, Cogen refused to accept the transfer of the contract without a guarantee from Huntsman’s parent company. The argument over what was meant by reasonable endeavours focussed on Huntsman’s refusal to provide that guarantee. That refusal therefore affected the transfer of the contract with Cogen for the supply of power.

Huntsman paid for the power from the date of its purchase of Rhodia in 2001 until 2004. However, in 2004 Huntsman told Rhodia that it was pulling out of the location and that responsibility for the power contract remained with Rhodia until the contract expired in 2009. Huntsman submitted the reason for this being that the contract for the supply of power had not been transferred. Cogen claimed that £14.8m worth of power and services was owed, and the case concerned Huntsman and Rhodia arguing over who owed Cogen that amount.

The case was eventually decided on what constituted ‘reasonable endeavours’ to ensure the contract transferred from one company to the other. It was ruled that Huntsman International had breached the sale agreement by not using its reasonable endeavours to provide a guarantee for a power contract. Julian Flaux QC, sitting as a deputy High Court Judge in the case said:

“An obligation to use reasonable endeavours to achieve the aim probably only requires a party to take one reasonable course, not all of them, whereas an obligation to use best endeavours probably requires a party to take all the reasonable courses he can. In that context, it may well be that an obligation to use all reasonable endeavours equates with using best endeavours…”

The ruling in the case made it clear that the terms of the sale contract were binding, even if its terms no longer suited one of the parties. The companies must abide by their contractual obligation to make a reasonable endeavour even if it is against their company interests.

However, there are other authorities which suggest a slightly different viewpoint. In the absence of a specific course of action assumed by a party in the context of a reasonable or best endeavours obligation, neither obligation is likely to require a party to sacrifice it own commercial interests. It appears from the other authorities – which were not discussed in this case – that ‘reasonable endeavours’ may not even require the party giving such an obligation to act to its own disadvantage. This would suggest that relatively little effort is required to comply with a ‘reasonable endeavours’ obligation.

As far as the drafting of contracts is concerned, the best way to achieve certainty would be to specify the actions a party must take in using its ‘best’ or ‘reasonable’ endeavours wherever possible. The relevant party will then be bound to take those actions in any event and the question of whether those actions are contrary to that party’s commercial interests will not arise.

In our founding documents it states that the United States of America is a nation built by the people and for the people. Unfortunately most of the laws in our society and civilization have been reshaped by lawyers and sometimes in a self-serving way. One cynical person in our online think tank stated; “America; By the People, For the Lawyers!”

Of course immediately one of the lawyers in the group labeled him a cynical person, which he immediately admitted freely. But he said; “just because I’m a cynic does not mean I am not correct.” So the question is what do you think? This is an article of pure opinion as you can tell.

Are we still a nation built by the people and for the people or are we a modified hybred; being built by the lawyers and for lawyers. If lawyers make our laws and we have to hire a lawyer to tell us what those laws are and then hire another lawyer if those laws are inadvertently or accidentally broken then who are we truly serving; ourselves “The People” or the lawyers to whom we have to pay money to for advice on how to live or run our businesses.

The cynic in the group suggested that in his business, which is a successful construction firm, he had to call his lawyer every time he wanted to use the company restroom to make sure it was okay? Indeed, it has not got that bad yet, but it surely could at the present rate in my humble opinion.

I certainly hope this article is of interest and that is has propelled thought. The goal is simple; to help you in your quest to be the best in 2007. I thank you for reading my many articles on diverse subjects, which interest you.

A car accident isn’t just a physical trauma – it can be a huge financial and legal burden as well, especially if you don’t have knowledgeable legal help in your time of need. Whether the car accident was your fault or not, it’s a good idea to get in touch with someone who can help you through the difficult and often confusing time that follows an auto accident.

So, what is a car accident lawyer?

A car accident lawyer is an attorney that helps to level the legal playing field after a car accident by informing you of your rights and responsibilities, and providing information on personal injury law and accident claims. Some circumstances surrounding a car accident require that a lawyer be involved, simply because of the complexity of dealing with the issue.

For instance, if you or anyone in your car was injured in the car accident, particularly if there is a permanent injury or an injury that results in lost income from work or lost time at school, a lawyer can help to recover some of these damages by filing a claim against the party responsible for the injuries.

The help of a lawyer should also be sought after a car accident if:

oThe car accident has resulted in an injury, particularly a serious injury such as broken bones or any other injury that will require hospitalization.

oThere has been a death resulting from the car accident.

oThe official police report appears to not accurately represent the car accident and its circumstances – particularly if the report puts you at fault.

oThe car accident occurred in a construction area.

oThe car accident involved bystanders or pedestrians.

oYour liability insurance will not cover the entirety of the damages.

oYou have no insurance.

oYour insurance company brings it their own lawyer. If this happens, immediate legal help should be found. It’s an emergency.

But an injury isn’t the only reason to contact a lawyer after a car accident. While a car accident such as a fender bender that doesn’t result in much damage probably doesn’t require a lawyer, a more complicated accident with more damage may require the help of a lawyer to navigate the murky waters of insurance claims, police reports, and liability.

In order to help your case, it is important that you not wait to seek the help of a lawyer and file a claim. Waiting too long to begin legal action might keep you from receiving the compensation that you deserve. Statutes of Limitation vary from state to state, and can limit the amount of money that you can recover, or eliminate it completely, whether you have the help of a lawyer or not.

Be prepared when you meet with a lawyer. Take any necessary documents, insurance information – both your own and that of the other party. Take the names of any witnesses there may have been, any photographic evidence taken at the scene, and a copy of the official police report. Any information can help your lawyer to help you, so be sure to prepare your documents before meeting with your lawyer for the first time.

This can be a profoundly difficult time for you and your family. With lost income and physical pain, there is no need to compound the suffering of you or your loved ones by having to go through a trying time alone. It’s important to know when to ask for help, and particularly when to seek the help of a trained professional, such as a car accident lawyer. Look for help from a trusted source.